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Washington, D.C – Criminals impersonating Internal Revenue Service (IRS) employees have scammed $55 million from more than 10,300 Americans over the last four years, evidence the agency should stop using private contractors to pursue taxpayers with IRS debts, said Tony Reardon, National President of the National Treasury Employees Union (NTEU).

The impersonation scam, as documented in the new semiannual report from the Treasury Inspector General for Tax Administration (TIGTA), has been a growing threat to innocent taxpayers around the country. Since October 2013, TIGTA has received more than 1.9 million complaints from taxpayers who had been called by people falsely claiming to be with the IRS, according to the report sent to Congress on Monday.

“And now that Congress has ordered the IRS to farm out debt collection work to private companies, the confusion and opportunity for fraud have only increased,” Reardon said. “This TIGTA report shows the real danger in making it easier for criminals to convince people – often seniors and lower-income taxpayers – to hand over cash in order to settle a debt that doesn’t exist.”

The scam has reached every state in the nation. Losses are the greatest in California, Florida, Illinois, New York, and Texas, but Georgia, Pennsylvania, Michigan and Virginia have been hit hard, too, the TIGTA report states.

The IRS in April started referring outstanding debt cases to four private collection agencies, which are paid on a commission basis and are allowed to contact taxpayers by phone, contradicting years of official IRS warnings that the agency does not call taxpayers.

That same month, TIGTA arrested eight individuals who, along with four others, were allegedly involved in impersonation schemes that defrauded more than 7,000 victims.

J. Russell George, the inspector general, recently testified to Congress that his office is monitoring whether the private collection agent program is exacerbating or widening the impersonation scam. National Taxpayer Advocate Nina Olson joined George at that hearing of the House Appropriations Financial Services Subcommittee expressing concern that the elderly and the poor were not excluded from the debt collection program.

NTEU, which represents IRS employees around the country, has opposed the use of private collection agencies, an idea that has failed twice before for being too expensive and subjecting taxpayers to aggressive tactics. This time, the use of the private collection agencies coincides with an increasing number of creative con artists who intimidate people to hand over personal financial information, iTunes cards or MoneyGrams.

“The impersonators told the victims that they owed additional tax and that if they did not immediately pay they would be arrested, lose their driver’s license or face other adverse consequences,” the TIGTA report states.

NTEU has endorsed H.R. 2171, The Taxpayer Protection Act of 2017, which would repeal the congressional mandate that the IRS outsource collection work to for-profit companies.

“The professional civil servants of the IRS should be allowed to do their job, which is to find the best solution for collecting tax revenue as quickly and fairly as possible,” Reardon said.

NTEU represents 150,000 employees at 31 federal agencies and departments.